Seven Basic Quality Management Tools

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Seven Basic Quality tools documents

Definition of Quality Management -- it is a method for ensuring that all the activities necessary to design, develop and implement a
product or service are effective and efficient with respect to the system and its performance. It is also a principle set by the company
to endure the continuous advocacy of quality services and products, or the further improvement of it.

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The Malcolm Baldrige National Quality Assurance Award

Original text on www.freequality.org

The
Malcolm Baldrige award was a program established in 1987 by congress to raise
awareness for the importance of quality.The award is given annually to companies in three different categories.These categories are manufacturing, service
and small business.Education and Health
Care were added in 1999.Many government
and industry leaders understood in the early 1980’s that quality would be
important for companies to embrace so that they would have continued success in
the expanding world markets.Malcolm
Baldrige was the secretary of commerce from 1981 to 1987.A strong advocate of quality management,
Malcolm Baldrige played a key role in implementing the Reagan administrations
trade policy.He was the CEO of a
company called Scovill inc. before working for the Reagan administration.
While working at Scovill, he transformed it
from a brass mill that was in financial difficulty, to a highly successful
producer of housing and industrial goods.While an organization can be outside the U.S. and still apply for the
award, the division of the organization that is applying must be within the
U.S.When companies apply for the
Malcolm Baldrige award, they have to go through a rigorous process with many stipulations
for entry.An independent board of
examiners researches the organization and follows a specific
criteria for this evaluation.Most organizations that apply for the award are headquartered in the
U.S.The examiners on the Independent
board are volunteers, and there are no rules that restrict the members of the
board to be hired as consultants for the organization to align their objectives
with the award criteria.The criteria
evaluation considers two dimensions of the organization.Actual business performance is the basis of
45% of the evaluation, while 55% of the evaluation is based on how the
organization is run.The evaluation
concerning results is based on the results that the company keeps on its
performance in areas such as financial, customer satisfaction, product and
service quality, and supplier performance and productivity.The evaluation based on how the organization
is run is measured by rating how the company leads, plans, measures, trains,
controls, and processes.All major parts
of the business are assessed, and the Baldrige looks for approaches that are
continuously evaluated and improved.There are seven areas that are specifically needed for winning the
award.These areas include Leadership,
Strategic planning, Customer and market focus, Information and analysis, Human
resource focus, Process management, and Business results.All aspects of criteria are tied together
because it is difficult to place a priority on one area and neglect other
areas.All criteria are tied together
and will show up one way or another in the final criteria, the “Business
results”.The first of the seven areas
of focus is leadership.This includes
the guidance of the organization by senior executives, how the organization
takes into account public concerns, and how the organization is involved in the
community.In the evaluation of
leadership, the Independent board considers if the senior executives are
totally committed to the concept of quality.The reason is that this will have an impact on the entire organization
and all employees.If the “leaders” of
the organization aren’t totally committed to the goal, then it would be
unreasonable to expect the employees to be totally committed.The next evaluation is Strategic
Planning.This includes how the
organization sets strategic directions including clear objectives in achieving
quality improvement.Key action plans
are also included and consist of items that are needed to be implemented to
meet the organizations objectives.Customer and market focus consists of how the organization determines
requirements of customers and the expectations of the customer and
markets.Information and analysis is how
effective the company uses the information available to it, and how this
information supports its key processes.The Human Resource focus considers if the organization enables its
workforce to develop its full potential and also if the workforce is aligned
with the organizations objectives.Process management examines aspects of key production, delivery and
support process consisting of design, management, and improvement.The final criterion is Business results.This area emphasizes the organizations
performance and improvement in its key business areas.The organizations performance is directly
related to how well the organization performs in other areas of criteria.This shows the need for total commitment to
improving all aspects of the business.The point values for each of these areas are as follows; Leadership –
110 points, Strategic planning – 80 points, Customer and market focus – 80
points, Information analysis – 80 points, Human resource development and
management – 100 points, Process management – 100 points, Business results –
450 points.If all other factors are
aligned with the organizations plans, and the company has a good plan for
managing quality, it will show up in the business results, this is the reason
for its high point total.Most companies
are rejected at the beginning of the process because they could not follow the
directions of the application process.The process has three stages of evaluation; the independent review, the
consensus review, and the site visit review.During each review, an applicant can be rejected.The MBQNA gives a feedback report to those that
fail to qualify for the next review, also, a feedback
report goes to the winners.Pat Croce,
the current president of the Philadelphia 76’ers, used to own a company called
Sports Physical Therapists.His original
company competed for the award, and Mr. Croce is quoted as saying “Competing
for the award had been enormously rewarding.The entire company had rallied around a common cause.”Just by competing for the award, SPT improved
itself by striving for a common goal.All areas of the business improved not only in the tangible areas like
customer satisfaction and business performance, but also in employee morale and
pride in the job they were doing.Just by competing for the award, the organization that is striving
to win already sees the importance of quality, and has made a conscious
decision to strive for excellence in the area of quality.The MBNQA can help an organization by having
the entire organization rally around a common goal, by creating clear
objectives to improve quality, and the national recognition should the company
win the award.The performance of MBNQA
winners is undeniable.Business week
compared Baldrige winners with the S&P 500 and created the Baldrige
index.Winners of the MBNQA outperformed
the S&P 500 $33,185 to $18,613.This
clearly shows the importance of quality improvement and gives tangible results
of how winners improve their profitability for investors.In comparison with other awards such as the
ISO 9000, the MBNQA stands out, for example, the ISO 9000 covers less than 10%
of the MBNQA criteria for judging quality.When applying for an award, the organization cannot be doing so just to
win, but needs to buy into the entire philosophy of quality improvement.It is in this way that the organization will
get the most benefit.Total quality
improvement will show in all aspects of the organization including increased
productivity, employee morale, customer satisfaction, and improved
profitability.The MBNQA is an extremely
useful item for an organization to strive for.

Bibliography

Baldrige National Quality Program.National Institute Of
Standards and Technology. 2 April 2001
<http://www.quality.nist.gov/>